Rupee ends down on mild importer dollar demand

Wednesday, 18 October 2017 00:00 - - {{hitsCtrl.values.hits}}

Reuters: The rupee ended slightly weaker in dull trade on Tuesday as importer dollar demand surpassed mild exporter greenback sales, dealers said.

Dealers said the rupee was under pressure last week due to dollar demand from state-run Ceylon Petroleum Corp (CPC), which stocked up crude ahead of an expected fuel price hike.

The spot rupee ended at 153.60/65 per dollar, slightly weaker from Monday’s close of 153.55/65.

“It was a dull day. There was not much of activity. But the rupee ended a tad weaker on mild importer (dollar) demand,” said a currency dealer, who requested anonymity.

“There was not much exporter dollar sales as well.”

Crude prices are expected to rise in the country after private fuel retailer Lanka IOC informed local media it is likely to increase rates as they have been selling at a loss.

The rupee has been under pressure since January after the central bank stopped defending the currency and started buying the dollar to build the country’s depleted foreign currency reserves.

The island nation has seen Rs. 19.1 billion ($ 124.35 million) of net inflows into equities this year, as of Tuesday’s close, and Rs. 33.8 billion into government securities as of 11 October, official data showed.